Agenda item

Director of Finance to report

The Audit Committee received a report of the Director of Finance which presented the Authority’s Treasury Management update report as at the end of Quarter 2, 2025/26 (30^th September 2025).

In considering the report member so the Committee were advised that in April 2023 Oldham Borough Council had Authority adopted the Chartered Institute of Public Finance and Accountancy’s Treasury Management in the Public Services: Code of Practice (the CIPFA Code), which required that the Council should approve, as a minimum, treasury management semi-annual and annual outturn reports. The report before this Audit Committee meeting included the requirement outlined in the 2021 Code for quarterly reporting of the treasury management prudential indicators. Oldham Council’s treasury management strategy for 2025/26 was approved at the Budget Council on 6^th March 2025.

The Authority had borrowed and invested substantial sums of money and was therefore exposed to financial risks including the loss of invested funds and the revenue effect of changing interest rates. The successful identification, monitoring and control of risks remained central to the Authority’s treasury management strategy.

The submitted report provided an additional update and included the requirements that were set out in the 2021 Code. The submitted report therefore, established the key Treasury Management issues for Members’ information and review and outlined the following:

·       An economic update for the first half of 2025/26 (External Context).

·       Net Borrowing and Investments (Local Context).

·       A review and updates of the Council’s current treasury management position.

·       Council Borrowing.

·       Treasury Investment Activity.

·       Treasury Performance for the first half of the year.

·       Compliance.

·       Treasury Management Prudential Indicators.

The report advised that the Council operated a balanced budget, which broadly meant that cash raised during the year would meet its cash expenditure. Part of the treasury management operation was to ensure that this cash flow was adequately planned, with surplus monies being invested with low-risk counterparties, providing at least an adequate liquidity, initially, before considering optimising investment returns.

A second main function of the treasury management service was the funding of the Council’s capital plans. These capital plans provided a guide to the borrowing need of the Council, essentially the longer-term cash flow planning to ensure the Council can meet its capital spending obligations. The management of longer-term cash often involved arranging long or short-term loans, or using longer term cash flow surpluses, and on occasion, any debt

previously drawn may be restructured to meet Council risk or cost objectives. As a consequence, therefore, treasury management was defined as …. “the management of the local authority’s investments and cash flows, its banking, money market, and capital market transactions; the effective control of the risks associated with those activities; and the pursuit of optimum performance consistent with those risks.”

In considering the report, Members of the Audit Committee were mindful that it would be presented to the Cabinet at its meeting on 1^st December 2025 and to the Council on 10^th December 2025.

1.    Resolved:
That the Audit Committee endorses the Treasury Management Half Year Review report, and the Treasury Management activity and projected outturn for 2025/26.

2.     That the Audit Committee recommends to the Cabinet and Council that the recommendations contained within the report be formally approved and adopted.